The critical difference is that Beyond, as its peer, Impossible Foods ( IMPF), is strictly vegan (no egg binders) and does not use wheat gluten or soy - cheaper plant-protein sources. Beyond Meat is certainly not a "first mover" in a high-growth industry it is a younger competitor in a relatively old and stabilized industry with immense competition. For one, commercialized vegetarian "grillable" meat alternatives have existed for many decades and, to an extent, since ancient times. Can Beyond Meat Ever Be Profitable?īeyond Meat's success has very little to do with the overall success of plant-based protein alternatives. I believe BYND's recent rally is likely to be a "dead cat bounce" that will proceed to more significant drawdowns than a sign of long-term reversal. The company also faces growing competition and could lose sources of recurring revenue. That said, Beyond's business model is very cost-intensive and, in my view, disproportionately exposed to supply-chain and inflation issues due to its processing-intensive nature. If it can accomplish this, BYND may rise much higher as its valuation is still far-below its IPO price.
2023 is the "make or break" year for the company if it fails to become profitable, it may cease to operate. In the long run, investors must determine whether or not Beyond Meat has robust plans that will enable it to become a consistently profitable and competitive enterprise. Although BYND's short interest has declined, it is still high enough to warrant an enormous short squeeze. Of course, when battered-down stocks rebound sharply, investors may flock to it as a discount opportunity. Beyond Meat's cash balance has worn down, and without new financing, it may go bankrupt this year if it continues to burn cash at its current pace. The company has disappointed investors due to its lack of revenue growth and seemingly out-of-control expenses. Despite its sharp reversal, BYND remains around 75% below its IPO value and over 90% below its peak price.
One notable example is Beyond Meat ( NASDAQ: BYND), which has risen 44% this year ahead of its Q4 report this Thursday. The beginning of 2023 saw the startling rebound of many stocks that struggled throughout 2022.
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